Global cards player Mastercard on Tuesday said it enabled around 200,000 online merchants across the country with card-on-file tokenisation.
Tokenisation replaces an actual or clear card number with an alternative code called the ‘token’. A tokenised card transaction is considered safer as the actual card details are not shared with the merchant during transaction processing, which helps cut the chances of information leakage. More than 200 million tokens have been created across networks, including Mastercard, since December 2021.
Mastercard said it worked with 45,000 merchants, 34 issuing banks, 10 acquiring banks, and 30-plus token requestors (including all major payment aggregators) to create 90 million tokens for its users since December 2021. It has also collaborated with payment aggregators, such as Juspay, PayU, Razorpay, BillDesk, and Paytm, to enable merchants to process token-based transactions.
The number of merchants adopting tokenisation is expected to increase in the run-up to the Reserve Bank of India’s (RBI’s) September 30 deadline. Last month, the RBI extended for a third time the deadline for card-on-file tokenisation as transaction processing based on these tokens were yet to gain traction.
The RBI had said the industry should use the extended time period to facilitate all stakeholders to be ready for handling tokenised transactions. The regulator also asked the payment players to create public awareness about the process of creating tokens and using them to undertake transactions.
“Mastercard is supportive of the RBI’s mandate, which will empower the larger merchant community and millions of cardholders to make rapid strides towards a less cash economy,” said Nikhil Sahni, country corporate officer, India, and division president, South Asia, Mastercard.
Following the RBI’s mandate on storage of card details, many companies launched their tokenisation solutions. PayU, an online payment solution provider, launched “PayU Token Hub”, which offers both network tokens and issuer tokens under a single hub. Razorpay has developed “Razorpay TokenHQ”, a multi network card–on–file tokenisation solution.
The National Payments Corporation of India (NPCI) has joined hands with brands and aggregators to introduce a tokenisation facility supported by the recently launched NPCI Tokenisation System.
